Apr 7, 2016 - Ryan W. Williams, Operations Research Analyst ..... Table 4-3: ANS Oil & Gas Production Tax Data Summa
Revenue Sources Book 2016 Spring
Revenue Sources Book 2016 Spring Department of Revenue Randall Hoffbeck, Commissioner Jerry Burnett, Deputy Commissioner Dona Keppers, Deputy Commissioner Tax Division Contacts
Contacts for Specific Topics
Ken Alper, Director (907) 465-8221
[email protected]
Constitutional Budget Reserve Fund: Gary Bader, Chief Investment Officer Alaska Department of Revenue, Treasury Division (907) 465-4399
[email protected]
Brandon Spanos, Deputy Director (907) 269-6736
[email protected] Dan Stickel, Assistant Chief Economist (907) 465-3279
[email protected]
Alaska Permanent Fund: Valerie Mertz, Chief Financial Officer Alaska Permanent Fund Corporation (907) 796-1530
[email protected] Investment Revenue: Ryan W. Williams, Operations Research Analyst Alaska Department of Revenue, Treasury Division (907) 465-2893
[email protected]
Alaska Department of Revenue • Tax Division • www.tax.alaska.gov
Department of Revenue COMMISSIONER’S OFFICE State Office Building 333 Willoughby Avenue, 11th Floor PO Box 110400 Juneau, Alaska 99811-0400 Main: 907.465.2300 Fax: 907.465.2389
April 7, 2016 The Honorable Bill Walker, Governor of Alaska P.O. Box 110001 Juneau, Alaska 99811-0001 Dear Governor Walker: With this letter, I present to you the Department of Revenue’s spring 2016 forecast. The spring forecast is an annual update to the fall forecast of state revenues for you, the Alaska Legislature, and the Alaska public. This update is a collaborative effort among the Department of Revenue, the Alaska Permanent Fund Corporation, and the Office of Management and Budget. We produced and released a preliminary forecast earlier to aid in the budget discussions. A more comprehensive forecast will occur in the fall. General fund unrestricted revenue (GFUR) is now forecast to be $1.3 billion in fiscal year FY 2016 and $1.2 billion in FY 2017. The revenue forecast is driven by an expectation of oil production of at least 500 thousand barrels per day and an average price of oil remaining between $30 and $40 per barrel for the next 15 months. The FY 2016 forecast represents a decrease in expected GFUR of about $250 million, or about a 16% decrease, compared to the projection in the fall 2015 forecast. The revenue forecast is based on a revised oil price forecast of about $40 per barrel versus $50 in the fall. The forecast prices over the next ten years have also been reduced to reflect anticipated future lower prices. The average price is now not forecast to reach $60 until FY 2021. However, with the global contraction on investment in production, and spare capacity that represents less than three percent of global demand – we also recognize the potential for significant price volatility over the next few years. I hope you find the information provided in the spring 2016 forecast to be interesting and useful. We look forward to providing you with a new forecast in the fall of 2016. Sincerely
Randall Hoffbeck, Commissioner
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IV · Spring 2016 Revenue Sources Book
www.tax.alaska.gov
Contents Executive Summary�����������������������������������������������������������������������������������������������������������������������������������������������2 Table 2-1: Total State Revenue, by restriction and type������������������������������������������������������������������������������������������3 Table 2-2: Unrestricted General Fund Revenue, by type and detail������������������������������������������������������������������������4 Table 2-3: Restricted Revenue, by type and category���������������������������������������������������������������������������������������������6 Table 2-4: Ten-Year Forecast of Total Unrestricted General Fund Revenue������������������������������������������������������������8 About the Forecast Methodology���������������������������������������������������������������������������������������������������������������������������9 Table 2-5: Current Year Revenue Subject to Appropriation���������������������������������������������������������������������������������10 Table 4-3: ANS Oil & Gas Production Tax Data Summary���������������������������������������������������������������������������������11 Table 8-4: Historical Production Tax Credits and Forecast; Detail, FY 2007-FY 2025�����������������������������������������12 Table A-3b: Petroleum Revenue Forecast�������������������������������������������������������������������������������������������������������������14 Table B-2: Price Differences from Fall 2015 Forecast�������������������������������������������������������������������������������������������15 Table C-1: Production Differences from Fall 2015 Forecast���������������������������������������������������������������������������������16
Alaska Department of Revenue · Tax Division
·1
Executive Summary General Discussion The spring forecast is an annual update of the fall forecast of state revenues for the Governor, the Alaska Legislature, and the Alaska public. This update is a collaborative effort among the Department of Revenue, the Alaska Permanent Fund Corporation, and the Office of Management and Budget.
The spring forecast for North Slope crude oil production revises expected production in FY 2016 from 500.2 thousand barrels per day to 520.2 thousand barrels per day; a meaningful increase of about 20,000 barrels per day from the fall 2015 forecast. This change reflects nine months of actual daily production levels.
State revenue comes from four major The revenue forecast is based on a sources: revised oil price forecast of about 1) oil revenue; 2) income from $40 per barrel versus $50 for FY sources other than oil, such as taxes, 2016, based on actual prices realized charges for services, licenses, permits, over the past several months and an fines and forfeitures; 3) federal apparent stabilization of ANS oil revenue; and 4) investment revenue, prices between $30-40 per barrel. primarily from the Alaska Permanent The forecast prices over the next Fund and the Constitutional Budget ten years have also been reduced to Reserve Fund (CBRF). reflect anticipated lower prices. The General fund unrestricted revenue average price is now not forecast (GFUR) is now forecast to be $1.3 to reach $60 until FY 2021. The billion in fiscal year (FY) 2016 department makes use of both and $1.2 billion in FY 2017. The probabilistic and deterministic price revenue forecast is driven by an forecasting methods to view ranges of expectation of oil production of at potential prices. This methodology is least 500 thousand barrels per day described on page 9. and an average price of oil remaining Petroleum is forecast to be between between $30 and $40 per barrel 55-60% of the unrestricted revenue for the next 15 months. The FY for FY 2016 and 2017 (see page 2016 forecast represents a decrease 15). This is a significant decrease in expected GFUR of about $250 from what was observed prior to the million, or about a 16% decrease, oil price collapse when oil revenue compared to the projection in the represented at least 88% or more of fall 2015 forecast. Compared to GFUR. State revenues will continue the fall 2015 forecast, the revenue to be sensitive to oil price and oil forecast for spring 2016 projects production, as well as the cost of lower revenue over each of the next production. ten years to reflect a lower expected price path. (1)
Expenditures for cash repurchase of tax credits are not included in revenue numbers presented in the forecast but are separately estimated. In FY 2015, the state purchased $628 million in tax credits through the Oil and Gas Tax Credit Fund (AS 43.55.028), and will purchase $500 million in FY 2016. In FY 2017, credits subject to purchase are expected to amount to $775 million under current law. The FY 2017 estimate includes newly earned credits as well as eligible credits beyond the $500 million cap for FY 2016. These credits are shown on pages 12 and 13. In FY 2015, total state revenue from all sources amounted to $8.5 billion. Total state revenue for FY 2016 is expected to be only $3.7 billion, due to large unrealized losses in the Alaska Permanent Fund. In FY 2017, total state revenue is expected to rebound to about $8.2 billion. A new presentation of revenue introduced in the Fall 2015 Revenue Sources Book takes into account what revenues are available for appropriation, regardless of customary designations or uses. There is expected to be about $3.9 billion in current-year revenue available for appropriation for FY 2016 and about $4.3 billion for FY 2017. For comparison, the state had $6.0 billion in current-year revenue available for appropriation in FY 2015. In addition to unrestricted
Alaska’s fiscal year runs from July 1 through June 30.
2 · Spring 2016 Revenue Sources Book
www.tax.alaska.gov
Table 2-1: Total State Revenue, by restriction and type ($ millions) History
Forecast
FY 2015
FY 2016
FY 2017
1,687.9
801.1
704.7
520.7
516.7
506.4
47.9
19.0
35.4
0.0
0.0
0.0
2,256.5
1,336.9
1,246.4
285.9
323.9
329.7
17.7
(6.6)
36.7
303.6
317.3
366.4
Petroleum Revenue
667.3
328.1
318.0
Non-Petroleum Revenue
205.3
240.1
277.9
2,585.7
(2,022.5)
2,856.6
3,458.4
(1,454.3)
3,452.5
3.2
4.3
4.3
2,512.7
3,459.2
3,149.4
Subtotal Federal Revenue
2,515.9
3,463.5
3,153.7
Total Restricted Revenue
6,277.8
2,326.5
6,972.6
Total State Revenue
8,534.3
3,663.3
8,219.0
Unrestricted Revenue Sources Unrestricted General Fund Revenue Petroleum Revenue Non-Petroleum Revenue Investment Revenue Federal Revenue Unrestricted General Fund Revenue Restricted Revenue Sources Designated General Fund Revenue Non-Petroleum Revenue Investment Revenue Subtotal Designated General Fund Revenue Other Restricted Revenue
Investment Revenue Subtotal Other Restricted Revenue Federal Revenue Petroleum Revenue(1) Federal Receipts
revenue, “current-year revenue available for appropriation” also includes designated general fund revenue, as well as realized earnings of the Permanent Fund accounted for in the Earnings Reserve, earnings of the CBRF, various royalty and tax deposits to the Constitutional
Budget Reserve, and various royalty and tax deposits in excess of the constitutional minimum into the Permanent Fund. The totals of some tables in this publication may not equal the sum of components due to rounding.
Petroleum revenue shown in the Federal category includes the state share of rents, royalties, and bonuses received from the National Petroleum Reserve - Alaska, as provided by federal law. (1)
Alaska Department of Revenue · Tax Division
Executive Summary · 3
Table 2-2: Unrestricted General Fund Revenue, by type and detail History
($ millions) Forecast
FY 2015
FY 2016
FY 2017
125.2 94.8 389.7 609.7
133.9 0.0 153.4 287.3
118.3 30.0 67.9 216.2
Royalties (including Bonuses, Rents, & Interest) Mineral Bonuses & Rents Oil & Gas Royalties Interest Subtotal Royalties
22.4 1,052.1 3.7 1,078.2
8.7 501.0 4.2 513.8
8.7 475.6 4.2 488.5
Unrestricted Petroleum Revenue
1,687.9
801.1
704.7
17.7 27.7 12.8 0.2 59.1 0.0 41.9 0.0 1.5 9.7 170.6
19.8 28.9 14.2 0.2 60.6 0.0 42.6 8.0 1.5 9.8 185.7
19.9 27.2 14.9 0.2 60.0 12.0 43.2 8.2 1.6 9.9 197.1
136.2
109.6
99.3
Fisheries Tax Fisheries Business Fishery Resource Landing Subtotal Fisheries Tax
21.3 5.1 26.4
13.7 5.5 19.3
16.0 6.0 21.9
Other Tax Charitable Gaming Estate Large Passenger Vessel Gambling Mining Subtotal Other Tax
2.5 0.0 6.6 38.6 47.7
2.5 0.0 6.7 24.4 33.6
2.5 0.0 6.7 19.7 28.9
381.0
348.1
347.2
Unrestricted Petroleum Revenue Petroleum Taxes Petroleum Property Tax Petroleum Corporate Income Tax Oil & Gas Production Tax Subtotal Petroleum Taxes
Unrestricted Non-Petroleum Revenue Non-Petroleum Taxes Excise Tax Alcoholic Beverage Tobacco Product – Cigarette Tobacco Product – Other Electric and Telephone Cooperative Insurance Premium Marijuana Motor Fuel Tax Motor Fuel Tax (conservation surcharge) Tire Fee Vehicle Rental Subtotal Excise Tax Corporate Income Tax
Subtotal Non-Petroleum Taxes
4 · Spring 2016 Revenue Sources Book
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Table 2-2: Unrestricted General Fund, by type and detail (continued from previous page)
History
($ millions) Forecast
FY 2015
FY 2016
FY 2017
Charges for Services General Government Natural Resources Other Subtotal Charges for Services
13.9 (0.6) 6.8 20.1
12.8 1.4 7.3 21.5
12.8 1.4 7.3 21.5
Fines & Forfeitures
11.5
11.4
11.4
Licenses & Permits Alcoholic Beverage Licenses Motor Vehicle Other Subtotal Licenses & Permits
1.3 29.5 3.6 34.4
1.3 38.0 3.2 42.5
1.3 35.5 3.2 40.0
Rents & Royalties Mining Rents & Royalties Other Non-Petroleum Rents & Royalties
6.0 30.3
5.0 30.3
4.7 30.3
Subtotal Rents & Royalties
36.3
35.3
34.9
Miscellaneous Revenues and Transfers Miscellaneous Alaska Housing Finance Corporation Alaska Industrial Development & Export Authority Alaska Municipal Bond Bank Authority Alaska Student Loan Corporation Alaska Energy Authority Alaska Natural Gas Development Authority Mental Health Trust Unclaimed Property Subtotal Transfers
16.4 3.1 10.2 0.0 0.6 0.2 0.0 0.0 7.0 37.5
21.6 8.7 17.7 0.9 0.0 1.0 0.0 0.0 8.0 57.9
21.6 13.5 6.3 0.9 0.0 1.0 0.0 0.0 8.0 51.3
520.7
516.7
506.4
46.3 1.6
17.4 1.6
33.8 1.6
47.9
19.0
35.4
2,256.5
1,336.9
1,246.4
Unrestricted Non-Petroleum Revenue, except federal and investment Investment Revenue Investments Interest Paid by Others Unrestricted Investment Revenue Total Unrestricted Revenue
Alaska Department of Revenue · Tax Division
Executive Summary · 5
Table 2-3: Restricted Revenue, by type and category ($ millions) History Designated General Fund Revenue Non-Petroleum Revenue Taxes Charges for Services Fines and Forfeitures Licenses and Permits Rents and Royalties Other Subtotal Investment Revenue Investments - Designated GF Other Treasury Managed Funds Subtotal Restricted Designated General Fund Revenue
Forecast
FY 2015
FY 2016
FY 2017
30.4 227.4 7.6 0.1 3.4 16.9 285.9
30.0 260.9 9.1 0.2 4.2 19.5 323.9
29.9 266.9 9.0 0.2 4.2 19.5 329.7
2.0 15.7 17.7
2.1 (8.7) (6.6)
2.7 34.0 36.7
303.6
317.3
366.4
518.3 149.0 667.3
228.1 100.0 328.1
218.0 100.0 318.0
89.7 45.2 23.6 33.9 6.0
83.4 89.1 23.5 32.3 5.0
85.4 125.5 23.3 32.3 4.7
6.9
6.8
6.8
205.3
240.1
277.9
4.1 197.7
4.2 54.8
5.4 67.0
2,931.4
2,055.9
2,501.1
(547.5) 2,585.7
(4,137.4) (2,022.5)
283.1 2,856.6
3,458.4
(1,454.3)
3,452.5
Other Restricted Revenue Oil Revenue Royalties to Alaska Permanent Fund & School Fund (includes Bonuses & Rents) Tax and Royalty Settlements to CBRF Subtotal Non-Petroleum Revenue Taxes Charges for Services Fines and Forfeitures Licenses and Permits Rents and Royalties Other Subtotal Investment Revenue Investments - Other Restricted Constitutional Budget Reserve Fund Alaska Permanent Fund (GASB)(realized earnings)(1) Alaska Permanent Fund (GASB)(unrealized earnings)(1) Subtotal Other Restricted Revenue
Both realized and unrealized gains and losses are included per Government Accounting Standards Board(GASB) Statement 34 as interpreted by the Finance Division of the Department of Administration in its Comprehensive Annual Financial Report.
(1)
6 · Spring 2016 Revenue Sources Book
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Table 2-3: Restricted Revenue, by type and category (continued from previous page) ($ millions) History
Forecast
FY 2015
FY 2016
FY 2017
2,512.7
3,459.2
3,149.4
3.2
4.3
4.3
Restricted Federal Revenue
2,515.9
3,463.5
3,153.7
Total Restricted Revenue
6,277.8
2,326.5
6,972.6
Federal Revenue Federal Receipts Oil Revenue NPR-A Royalties, Rents and Bonuses
Alaska Department of Revenue · Tax Division
Executive Summary · 7
Table 2-4: Ten-Year Forecast of Total Unrestricted General Fund Revenue FY
2016
2017
2018
2019
($ millions) 2020 2021
Unrestricted Oil Revenue
801.1
704.7
787.5
872.7
938.9 1,007.5 1,042.0 1,105.9 1,056.7 1,076.4
516.7
506.4
514.8
520.7
522.6
528.4
531.3
541.0
547.3
553.7
19.0
35.4
44.0
52.6
61.1
69.7
78.3
86.8
95.4
104.0
Unrestricted Other Revenue (except Federal & Investment) Unrestricted Investment Revenue Total Unrestricted General Fund Revenue Total Unrestricted General Fund Revenue from Petroleum
2022
2023
2024
2025
1,336.9 1,246.4 1,346.3 1,445.9 1,522.6 1,605.5 1,651.5 1,733.7 1,699.3 1,734.1 60%
8 · Spring 2016 Revenue Sources Book
57%
58%
60%
62%
63%
63%
64%
62%
62%
www.tax.alaska.gov
About the Forecast Methodology
At times, the department’s forecast numbers may appear different for different analyses even if they come from the same data source. This can happen for many reasons and does not necessarily discount other analyses. One example is in petroleum revenue forecasting, where results can differ depending on whether the department uses confidential company-specific data versus statewide aggregated summary data. Another example where differences can occur is when the department provides deterministic and probabilistic results of oil revenue calculations. $200 $180
The Revenue Sources Book relies more heavily on deterministic (single-value) inputs and results. A probabilistic analysis of oil revenues brings the possibility of higher prices into the petroleum tax calculation. As such, results can be either lower or higher than a deterministic analysis utilizing the same basic price data. Therefore, even though all the department’s models start with the same set of data, the results can differ depending on assumptions about central tendency and the distribution of potential results.
Forecast
Actual
$160 $140 $120 $100 $80 $60 $40 $20
Fall
Spring
The above figure shows how, while the probabilistic price distribution remains unchanged, the deterministic forecast has been shifted between fall 2015 and spring 2016. In this manner, price volatility can be reflected in the department’s models and analysis and still provided deterministic outputs for budgeting and other purposes.
Alaska Department of Revenue · Tax Division
Executive Summary · 9
Table 2-5: Current Year Revenue Subject to Appropriation (1) ($ millions) History
Forecast
FY 2015
FY 2016
FY 2017
1,687.9
801.1
704.7
Royalties to Alaska Permanent Fund beyond 25% dedication (2)
111.3
38.9
37.8
Tax and Royalty Settlements to CBRF
149.0
100.0
100.0
0.0
0.0
0.0
1,948.1
940.0
842.5
Unrestricted General Fund
520.7
516.7
506.4
Designated General Fund
285.9
323.9
329.7
Royalties to Alaska Permanent Fund beyond 25% dedication (2)
2.9
2.4
2.2
Tax and Royalty Settlements to CBRF
0.1
0.1
0.1
809.6
843.1
838.4
Unrestricted General Fund
47.9
19.0
35.4
Designated General Fund
17.7
(6.6)
36.7
197.7
54.8
67.0
2,931.4
2,055.9
2,501.1
Subtotal Investment Revenues
3,194.7
2,123.1
2,640.2
Total Revenue Subject to Appropriation
5,952.4
3,906.2
4,321.1
Total State Revenue
8,534.3
3,663.3
8,219.0
Petroleum Revenue Unrestricted General Fund
Federal Revenue Subtotal Petroleum Revenues Non-Petroleum Revenue
Subtotal Non-Petroleum Revenues Investment Revenue
Constitutional Budget Reserve Fund Alaska Permanent Fund - Realized Earnings
This represents only the largest known categories of current-year funds subject to appropriation. A comprehensive review of all accounts in the state accounting system would likely reveal additional revenues subject to appropriation beyond those identified here.
(1)
(2)
Estimate based on deposit to Permanent Fund minus 25% of total royalties.
10 · Spring 2016 Revenue Sources Book
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Table 4-3: ANS Oil & Gas Production Tax Data Summary ($ millions) History
Forecast
FY 2015
FY 2016
FY 2017
72.58
39.99
38.89
9.74
10.50
10.86
62.83
29.49
28.03
500.7
520.2
507.1
66.2
66.3
62.0
434.5
453.9
445.2
Operating Expenditures [OPEX]
3,438.8
3,235.2
3,075.9
Capital Expenditures [CAPEX]
3,992.0
3,315.1
2,970.3
7,430.8
6,550.3
6,046.2
Operating Expenditures [OPEX]
3,318.6
2,471.9
2,422.7
Capital Expenditures [CAPEX]
3,595.8
2,248.9
2,040.0
Deductible North Slope Expenditures
6,914.4
4,720.8
4,462.6
389.7
153.4
67.9
2.5
0.9
0.4
Credits Used against Tax Liability (in $ millions)
664.0
70.0
135.0
Credits for Potential Purchase (in $ millions)
628.0
500.0
775.0
North Slope Price and Production Price of ANS WC (in $/barrel) Transit Costs & Other (in $/barrel) ANS Wellhead (in $/barrel) North Slope Production Total ANS Production (in mbbls/day) Royalty and federal (in mbbls/day)
(1)
Taxable Barrels (in mbbls/day) North Slope Lease Expenditures(2)(3) Total North Slope Lease Expenditures (in $ millions)
Total North Slope Expenditures Deductible North Slope Lease Expenditures (in $ millions)
State Production Tax Revenue(4) Tax Revenue (in $ millions) Production Tax Collected per Taxable Barrel Statewide Production Tax Credits(2)(5)
Royalty and federal barrels represent the department’s best estimate of barrels that are not taxed. This estimate includes both state and federal royalty barrels, barrels produced from federal offshore property, and other untaxed barrels.
(1)
(2)
Lease expenditures and credits used against tax liability for FY 2015 were prepared using unaudited company-reported estimates.
Expenditure data for FY 2016 and FY 2017 are compiled from company submitted expenditure forecast estimates and other documentation as provided to the DOR. Expenditures shown here are shown in two ways: (1) total estimated allowable expenditures for all companies on the North Slope; and (2) estimated “deductible expenditures” defined for purposes of this analysis as the amount of total allowable expenditures for each company that does not exceed their gross value at point of production. Note that for producers with a net operating loss, only a portion of expenditures will be counted in the “deductible expenditures” category. (3)
Production tax is calculated on a company specific basis, therefore the aggregated data reported here will not generate the total tax revenue shown. For an illustration of the tax calculation, see Appendix E in the 2015 Fall Revenue Sources Book. (4)
Production tax credits shown include all production tax credits and all areas of the state. Assumptions for the $12 million credits for small Alaska producers are included in the table. Per-taxable-barrel credits for oil not eligible for the gross value reduction may not reduce a producer’s liability below the minimum tax; that limitation is reflected in these estimates. (5)
Alaska Department of Revenue · Tax Division
Executive Summary · 11
Table 8-4: Historical Production Tax Credits and Forecast; Detail, FY 2007-FY 2025
FY Refunded Credits North Slope Qualified capital expenditure, AS 43.55.023(a); Carry-forward, AS 43.55.023(b) Credits under AS 43.55.025 (4) Total North Slope
($ millions) History 2010 2011 2012
2007
2008
2009
55 0 55
* * 53
173 14 187
223 23 246
399 12 411
0 0 0 0
* * * 1
* * * 7
* * * 4
55
54
193
Credits Used Against Tax Liability (6)(7) North Slope Qualified capital expenditure, AS 43.55.023(a); Carry-forward, AS 43.55.023(b) Transitional investment credit: AS 43.55.023(i)(8) Per taxable barrel credit, AS 43.55.024(i)-(j) (9) Small producer credit, AS 43.55.024(a)(c) Credits under AS 43.55.025 (4) Total North Slope
292 171 0 * * 541
219 73 0 * * 368
Non-North Slope Qualified capital expenditure, AS 43.55.023(a); Carry-forward, AS 43.55.023(b); Well lease expenditure, AS 43.55.023(l) Small producer credit, AS 43.55.024(a)(c) Total Non-North Slope
* * 16
Non-North Slope Qualified capital expenditure, AS 43.55.023(a); Carry-forward, AS 43.55.023(b); Well lease expenditure, AS 43.55.023(l) Credits under AS 43.55.025 (4) Credits under AS 43.20 (5) Total Non-North Slope Total Refunded Credits
Total Credits Used Against Tax Liability Total Credits North Slope Total Credits Non-North Slope Total Statewide Production Tax Credits Carried-Forward Credits Balance for Companies Not Eligible for Refund(11)
2013
2014
2015(1)
267 53 320
* * 261
* * 281
203 21 224
* * * 39
29 4 0 33
* * * 108
* * 15 312
384 21 0 404
250
450
353
369
592
628
279 0 0 * * 328
339 0 0 * * 402
313 0 0 * * 345
306 * 0 * * 347
486 * 0 * * 536
332 0 516 * * 907
0 0 595 * * 655
* * 10
0 6 6
* * 10
11 6 17
* * 16
* * 14
* * 12
* * 9
557(10) 378 596 421 16 11 612 432
334 * * 526
412 647 14 662
361 756 56 811
363 667 49 716
550 797 122 918
919 1,188 323 1,511
664 879 413 1,292
0
0
0
0
0
0
0
0
0
* An asterisk indicates that the data is confidential. (1) These numbers are preliminary pending analysis of Annual Returns. (2) Forecasted refunded credits are rounded to nearest $5 million and forecasted credits against liability are also rounded to the nearest $5 million. (3) Forecasted refunded credits in the near-term are based on known projects and company activities. For FY 2020 and beyond, the forecast of credits available for refund is held constant at $250 million per year. (4) Credits under AS 43.55.025 include the Alternative Credit for Exploration, the Frontier Basin Credit, and for Cook Inlet only the Cook Inlet Jack-up Rig Credit. (5) Credits under AS 43.20 include the Gas Exploration and Development Credit, Gas Storage Facility Credit, the In-State Gas Refinery Credit, and the LNG Storage Facility Credit. (6) The Education Credit, AS 43.55.019, though not reported in its own credit category in the summary, was less than $1 million in each year reported and is calculated in the total.
12 · Spring 2016 Revenue Sources Book
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Table 8-4: Historical Production Tax Credits and Forecast; Detail, FY 2007-FY 2025 (continued)
FY Refunded Credits (3) North Slope Qualified capital expenditure, AS 43.55.023(a); Carry-forward, AS 43.55.023(b) Credits under AS 43.55.025 (4) Total North Slope
($ millions) Forecast (2) 2020 2021
2016
2017
2018
2019
2022
2023
* * 214
370 76 447
283 35 318
251 0 251
180 0 180
Non-North Slope Qualified capital expenditure, AS 43.55.023(a); Carry-forward, AS 43.55.023(b); Well lease expenditure, AS 43.55.023(l) Credits under AS 43.55.025 (4) Credits under AS 43.20 (5) Total Non-North Slope
* * 0 286
260 41 25 325
136 24 20 181
96 5 20 121
Total Refunded Credits
500
775
500
Credits Used Against Tax Liability (6)(7) North Slope Qualified capital expenditure, AS 43.55.023(a); Carry-forward, AS 43.55.023(b) Transitional investment credit, AS 43.55.023(i)(8) Per taxable barrel credit, AS 43.55.024(i)-(j) (9) Small producer credit, AS 43.55.024(a)(c) Credits under AS 43.55.025 (4) Total North Slope
12 0 29 23 0 63
82 0 16 27 0 125
Non-North Slope Qualified capital expenditure, AS 43.55.023(a); Carry-forward, AS 43.55.023(b); Well lease expenditure, AS 43.55.023(l) Small producer credit, AS 43.55.024(a)(c) Total Non-North Slope
7 0 7
Total Credits Used Against Tax Liability Total Credits North Slope Total Credits Non-North Slope Total Statewide Production Tax Credits Carried-Forward Credits Balance for Companies Not Eligible for Refund
2024 2025
111 0 111
118 0 118
163 0 163
144 0 144
141 0 141
64 5 20 89
114 5 20 139
117 5 10 132
82 5 0 87
104 3 0 106
109 0 0 109
375
270
250
250
250
250
250
152 0 24 14 0 190
166 0 55 14 0 235
175 0 97 19 0 291
187 0 105 17 0 309
129 0 90 13 0 232
77 0 76 5 0 158
59 0 64 4 0 126
0 0 52 3 0 55
11 0 11
11 3 14
11 5 16
11 5 16
11 5 16
34 12 46
34 12 46
34 12 46
33 6 39
70 277 293 570
135 521 387 910
205 507 195 705
250 487 137 625
305 471 105 575
325 420 155 575
275 350 177 525
205 322 132 455
170 270 152 420
95 195 148 345
357
618
751
732
585
265
136
59
0
0
(7) For historical credits against tax liability, geographic location was determined by attributing all .023(l) credits to Non-North Slope, all .025 credits to North Slope, and the other credits were placed according to where the taxpayer primarily operated. Since multiple taxpayers had operations multiple areas, these numbers should be treated as rough estimates. (8) The Transitional Investment Expenditure credit sunset on Dec. 31, 2013. (9) For FY 2014, the Per Taxable Barrel Credit is for only the last six months of the fiscal year. Credits applied against liability in the forecast are limited by a company’s tax liability including the minimum tax. (10) Three months of 2006 credits data are included in the FY 2007 credits used against tax liability number. (11) This row includes estimates of carried-forward credits for previous calendar years for companies with over 50,000 BOE of production, plus an estimate of credits that will be earned on activity through June 30 of the fiscal year. Carried-forward credits are primarily for net operating losses under AS 43.55.023(b).
Alaska Department of Revenue · Tax Division
Executive Summary · 13
Table A-3b: Petroleum Revenue Forecast ($ millions) FY
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
133.9
118.3
118.5
117.3
116.5
114.9
113.2
111.4
109.4
107.4
0.0
30.0
105.0
135.0
165.0
195.0
190.0
185.0
180.0
175.0
144.8
59.4
15.7
10.7
12.5
32.5
109.9
217.3
212.0
275.2
Oil and Gas Hazardous Release
8.6
8.4
8.2
8.1
7.7
7.0
6.5
6.0
5.5
5.0
Oil and Gas Conservation
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
Oil and Gas Royalties-Net Bonuses, Rents & InterestNet(1)(2) Petroleum Special Settlements
501.0
475.6
527.3
588.7
624.4
645.1
609.5
573.4
536.9
500.9
12.9
12.9
12.9
12.9
12.9
12.9
12.9
12.9
12.9
12.9
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
Unrestricted Petroleum Revenue
801.1
704.7
787.5
872.7
Unrestricted Petroleum Revenue Petroleum Property Tax Petroleum Corporate Income Tax Oil and Gas Production Tax
(1)
Cumulative Unrestricted Petroleum Revenue(3)
938.9 1,007.5 1,042.0 1,105.9 1,056.7 1,076.4
115,851 116,556 117,343 118,216 119,155 120,162 121,204 122,310 123,367 124,443
Restricted Petroleum Revenue NPR-A Rents, Royalties, Bonuses Royalties to AK Permanent Fund Royalties to Public School Fund
4.3 224.4 3.7
4.3 214.4 3.6
4.3 238.8 3.9
6.5 274.7 4.4
8.6 291.8 4.7
7.3 294.4 4.8
6.2 273.9 4.5
5.5 255.1 4.2
5.1 237.6 4.0
4.9 220.9 3.7
CBRF Deposits
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Restricted Petroleum Revenue
332.4
322.3
347.0
385.6
405.1
406.5
384.6
364.9
346.7
329.5
1,133.5 1,026.9 1,134.5 1,258.3 1,344.0 1,414.0 1,426.5 1,470.7 1,403.4
1,405.9
Total Petroleum Revenue
(1)
Net of Permanent Fund Contribution and CBRF deposits.
(2)
Primarily composed of petroleum revenue.
(3)
Based on revenue beginning in FY 1959.
14 · Spring 2016 Revenue Sources Book
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Table B-2: Price Differences from Fall 2015 Forecast 2016
2017
2018
($ per barrel of oil) 2019 2020 2021
39.99
38.89
43.79
48.89
54.48
60.29
61.64
63.03
64.45
65.90
29.49
28.03
32.44
37.03
41.86
46.70
47.14
47.54
47.87
48.12
ANS West Coast
49.58
56.24
62.73
68.95
71.05
77.68
80.00
81.80
84.53
87.35
ANS Wellhead Wtd Average All Destinations
39.02
45.08
51.22
56.99
58.49
64.19
65.54
66.27
67.77
69.24
FY Spring 2016 Forecast ANS West Coast ANS Wellhead Wtd Average All Destinations
2022
2023
2024
2025
Fall 2015 Forecast
Price change from prior forecast ANS West Coast (9.59) (17.35) (18.95) (20.06) (16.58) (17.39) (18.36) (18.77) (20.08) (21.45) ANS Wellhead Wtd Average All Destinations
(9.53) (17.05) (18.79) (19.96) (16.63) (17.49) (18.40) (18.72) (19.90) (21.12)
Percent change from prior forecast ANS West Coast -19.4% -30.8% -30.2% -29.1% -23.3% -22.4% -23.0% -22.9% -23.8% -24.6% ANS Wellhead Wtd Average All Destinations
-24.4% -37.8% -36.7% -35.0% -28.4% -27.2% -28.1% -28.3% -29.4% -30.5%
Alaska Department of Revenue · Tax Division
Executive Summary · 15
Table C-1: Production Differences from Fall 2015 Forecast FY Spring 2016 Forecast Alaska North Slope Non-North Slope Total
2016
2017
2018
(thousands of barrels per day) 2019 2020 2021 2022
520.2 17.3 537.5
507.1 16.1 523.2
488.8 14.7 503.5
484.4 13.5 498.0
454.1 12.5 466.7
418.6 11.7 430.2
387.1 10.9 397.9
356.8 10.2 366.9
327.0 9.6 336.5
300.5 9.0 309.5
Fall 2015 Forecast Alaska North Slope Non-North Slope Total
500.2 17.8 518.0
504.9 16.1 521.0
497.7 14.7 512.4
487.6 13.5 501.1
460.5 12.5 473.0
423.9 11.7 435.6
391.1 10.9 402.0
359.8 10.2 370.0
329.2 9.6 338.8
302.1 9.0 311.1
Volume change from prior forecast Alaska North Slope 20.0 Non-North Slope (0.5) Total 19.5
2.2 0.0 2.2
(8.9) 0.0 (8.9)
(3.2) 0.0 (3.2)
(6.4) 0.0 (6.4)
(5.3) 0.0 (5.3)
(4.0) 0.0 (4.0)
(3.0) 0.0 (3.0)
(2.2) 0.0 (2.2)
(1.6) 0.0 (1.6)
Percent change from prior forecast Alaska North Slope 4.00% Non-North Slope -2.85% Total 3.76%
16 · Spring 2016 Revenue Sources Book
2023
2024
2025
0.44% -1.79% -0.65% -1.38% -1.26% -1.03% -0.84% -0.67% -0.52% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.42% -1.74% -0.64% -1.35% -1.22% -1.01% -0.82% -0.65% -0.51%
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